Sierra Blanca owns the Sierra Blanca gold-silver project in the Santa Cruz province of Argentina. Credit: Roman Bodnarchuk via Shutterstock.com.

Capella Minerals and Austral Gold have agreed to sell their combined 100% interest in Sierra Blanca, which owns the Sierra Blanca project, to Unico Silver.

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This gold-silver project is located in the Santa Cruz province of Argentina.

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It comprises five mining titles spread over 7,997ha and is located east and west of Unico’s Angostura Pinguino properties.

Capella and Austral hold 45.31% and 54.69% stakes in Sierra Blanca, respectively.

Under the agreement, Unico Silver will issue five million ordinary shares at A$0.151 each and pay cash to cover Sierra Blanca’s administrative fees.

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The deal’s completion is pending approvals from the Australian Securities Exchange (ASX) and TSX Venture Exchange (TSXV), and Unico shareholder consent for the share issuance to Austral.

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Once completed, Austral Gold’s existing interest in Unico is expected to increase from 11.62% to 12.33%.

Additionally, the deal awaits the execution of a deed of assignment concerning a net smelter return (NSR) on the Sierra Blanca project.

Upon closing, Capella will allocate half of the proceeds from Unico to Sandstorm Gold, thereby nullifying the annual maintenance payments due under a 2018 share purchase agreement related to Sierra Blanca.

Capella president and CEO Eric Roth said: “We are pleased to be announcing today the sale of our Sierra Blanca epithermal gold-silver project in Argentina to Unico Silver.

“Unico have established a strong presence in Santa Cruz through their adjacent Cerro Leon project and have the local and technical experience required to advance Sierra Blanca.

“The sale of the Sierra Blanca project is also consistent with our stated goal of divesting our non-core assets in the Americas and focusing on our Scandinavian exploration assets.”